The chart of the week highlights personal outlays by income group from late 2019 through the end of 2024. The highest-income households show the steepest increase in spending, while lower-income households initially pulled back during the pandemic but began to spend more after 2021. Middle-income households remained relatively stable, with their spending consistently tracking just above the Consumer Price Index, or inflation. Notably, the spending gap between income groups has widened and most reports indicate this trend has continued into 2025. A key concern for the economy going forward is whether consumer spending can be sustained; while high-income households have largely driven recent growth, any slowdown from them, combined with ongoing weakness among lower-income groups, will likely start to show in future earnings reports and thus the market.